Despite high inflation, according to Statistics Austria, housing costs rose slightly less than disposable household income from at least 2012 to 2022. Director-General Tobias Thomas stressed in Vienna on Wednesday that there are currently no indications that this could change in the near future.
On average, Austrian households spend about 16 percent of their income on housing. But there is a big difference between homeowners and renters. While the former spend only ten percent of their income on housing, this is about a quarter for tenants. The data shows that owning a home is much cheaper than renting, even when financing costs are taken into account. Owners have seen only a slight increase in housing costs over the last decade, while tenants with an open contract are now paying almost a third more than in 2012.
In absolute figures, in 2022 this was only 430 euros per month for homeowners and 479 euros for apartment owners. Main tenants, on the other hand, have to take into account 774 euros per month. In addition to rent or credit, housing costs also include operating, energy and maintenance costs and waste or water costs. A statistically average main residence in Austria was 102 square meters.
Rents are of little importance given inflation
Thomas also tempers hopes that a rent brake could noticeably lower inflation. The increase in rents contributed only 0.05 percentage point to inflation in 2022, as rents have a small weight in the shopping basket. While slower increases could be crucial for individual households, they would hardly change the consumer price index. Nevertheless, CBS assumes that rents with an adjustment clause from three percent inflation will have a maximum of three rent increases per year, with adjustment clauses of five percent there are more than two adjustments.
According to Thomas, only more construction activity can lead to lower rents in the long term – also because the population is increasing and with it the demand for housing.
More payment arrears and evictions to fear
At the same time, however, it should also be borne in mind that rents only rise with a lag, as index jumps in the contracts only take effect after a certain level of inflation has been reached. Further noticeable adjustments can be expected due to inflation in 2023. Accordingly, more tenants in arrears and more evictions will be feared in 2023, Regina Fuchs, head of the Population Directorate of Statistics Austria, said at the joint press conference.
Long-term contracts cheaper for tenants
The statistics make it very clear that long leases are cheaper for tenants. “The lease term is the most important factor influencing the total rent,” says Fuchs. While in Austria rent plus operating costs total EUR 10.5 per square meter for contracts less than two years old, it is only EUR 5.75 for contracts more than 30 years old. On average, all contracts are 8.7 euros to pay. Contracts with a term of less than five years are also more expensive than average, while longer contracts lead to below-average costs.
Source: Krone
I am Wallace Jones, an experienced journalist. I specialize in writing for the world section of Today Times Live. With over a decade of experience, I have developed an eye for detail when it comes to reporting on local and global stories. My passion lies in uncovering the truth through my investigative skills and creating thought-provoking content that resonates with readers worldwide.
